XINJI ENERGY(SH:601918) HTSC·2025-08-25 06:53Investment Rating - The report maintains a "Buy" rating for the company with a target price of 7.36 RMB [4][6]. Core Views - The company's performance in the first half of 2025 was below expectations, with a revenue of 5.811 billion RMB, down 2.91% year-on-year, and a net profit of 920 million RMB, down 21.72% year-on-year. The lower-than-expected on-grid electricity price is a primary factor for this performance [1]. - The company is expected to benefit from the "coal-electricity joint operation" effect as new coal power plants come online, which should enhance profitability [1][3]. - The external coal sales price decreased significantly in Q2 2025, but there is potential for recovery in Q3 2025 due to recent market price rebounds [2]. - The company has a substantial amount of coal power capacity under construction, which is anticipated to be operational by the end of 2025, further supporting the "coal-electricity joint operation" strategy [3]. Summary by Sections Financial Performance - In 1H25, the company achieved a net profit of 920 million RMB, a decrease of 21.72% year-on-year, with a revenue of 5.811 billion RMB, reflecting a 2.91% decline year-on-year [1]. - The net profit from the coal segment fell by 21.75% to 816 million RMB due to declining coal prices [2]. Sales and Pricing - The external coal sales volume in Q2 2025 was 4.8304 million tons, with a sales price of 478 RMB per ton, down 13.72% year-on-year [2]. - The report anticipates a recovery in external coal prices in Q3 2025 due to recent market trends [2]. Future Outlook - The company has 4.64 million kW of coal power capacity under construction, expected to start production by the end of 2025, which will enhance the "coal-electricity joint operation" effect [3]. - The target price of 7.36 RMB is based on a revised earnings forecast, reflecting a decrease in expected net profits for 2025-2027 [4].